Is the Decline in Fee Revenue a Sign of Deterioration? Ignas: The Fundamental Value of Ethereum Has Already Been Reshaped Through Evolution

As Ethereum’s Transaction Fee Revenue Declines Due to L2 Technology Adoption, Many Public Chains Overtake It, Raising Market Doubts: “Is ETH Losing Value?”

In response, DeFi analyst DefiIgnas and user fabdarice expressed their views, emphasizing that the assessment of L1 blockchain value should not only focus on transaction fees but also include key aspects such as decentralization and ecosystem maturity.

Transaction Fees ≠ Value? Tron vs. Ethereum Unveils Key Blind Spots

DefiIgnas pointed out in a tweet that measuring blockchain value solely based on transaction fee revenue is indeed too narrow.

Valuing L1s based only on fees is shortsighted. If that was the case, $TRX should trade higher than $ETH. But it’s not. Decentralization (meaning security), dev activity, TVL, ecosystem maturity, tokenomics… all these factors matter. Opinions that ETH is dumping because…pic.twitter.com/sF9xFQGy7H

He used Tron as an example: although its transaction fee revenue recently exceeded that of Ethereum, its market capitalization and the value assigned by the market are far lower than ETH. He emphasized that decentralization, security, developer activity, total value locked (TVL), and tokenomics are the key factors for long-term influence. Many users further pointed out that Tron’s transaction fees mainly stem from stablecoin trading volume, but the ecosystem lacks innovation and decentralization, limiting its potential: In my opinion, revenue only determines the lower limit of a blockchain’s value, while its application scenarios define its upper limit.

Low Transaction Fees Equal Failure? Ignas Responds: Ethereum is Still Evolving, Not Declining

Faced with the decline in Ethereum’s transaction fees, some market analysis firms have begun to lower ETH price predictions, even considering that its development momentum is waning. However, DefiIgnas believes that this is actually a natural evolution of blockchain towards efficiency and sustainability: If we solely look at transaction fees to judge heroes, Bitcoin’s market capitalization should not surpass Ethereum, but the reality is obviously the opposite.

He also cited the viewpoint of user fabdarice, stating that Ethereum had no concept of “revenue” during its early proof-of-work (PoW) phase, and the current decline in transaction fees is a symbol of the success of L2 solutions. He mentioned that Ethereum is still often congested, with transaction volume growing 15 times, and the issuance rate dropping from 4.06% to 0.7%. These data reflect that its long-term competitiveness is enhancing.

“Revenue ” == “Ethereum dying”

• Meanwhile:
• Prior to PoS, Ethereum had no revenue
• Ethereum blocks have consistently been full
• Ethereum is doing 15x transactions with Rollups
• Fees on Ethereum sub $1
• Issuance lowered from 4.06% -> 0.7%

Ethereum ain’t dying. It’s going…pic.twitter.com/TKZrldw945

Not Digital Oil, but the Cornerstone of the Digital Economy! Ethereum’s Multiple Values Are Taking Shape

DefiIgnas pointed out that, for him, Ethereum and L1 tokens like Solana belong to “productive assets,” not just for trading or storage, but also for participating in ecosystem activities, airdrops, and value creation. He admitted that such strategies carry speculative elements but are also a way to explore L1 value: Bitcoin is used to combat macroeconomic instability, while Ethereum plays a different role in the digital economy; the sources of their value do not conflict.

Moreover, he emphasized Ethereum’s irreplaceable status as collateral in DeFi ecosystems such as MakerDAO or Ethena, which will also become a key pillar of the digital economy in the future: The market’s perception of Ethereum’s value is shifting from a purely “digital oil (source of transaction fees)” to a broader role; therefore, its value will need to be evaluated from multiple perspectives.

Stop Viewing Blockchain with a Narrow Lens; The Value of L1 May Need to Be Reevaluated

This discussion about Ethereum and L1 blockchain value serves as a reminder that price and revenue are just the tip of the iceberg. The analyses by DefiIgnas and fabdarice reveal that true value comes from technology, decentralization, ecosystem expansion, and network effects. In the future, the criteria for assessing L1 value will be more diverse and closely aligned with their critical roles in the digital economy.

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